I entered short term gains from my 1099B and noticed that the tax rate on this was 50%. TT had changed my QBI deduction. Why? Income is above all the phase outs.

The QBI deductions seems like it should be unrelated to the short term gains so this makes no sense that my QBI deduction would be reduced.

476

Level 2

Feb 21, 2021 4:59:06 PM

It appears that we actually were still in the phase out for the QBI since our business is an SSTB and the increase in our total income did reduce the QBI deduction we are allowed. This whole QBI stuff is complete crap. A more complicated system could hardly be devised, nonetheless, I see what the problem is and have answered my own question.

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I entered short term gains from my 1099B and noticed that the tax rate on this was 50%. TT had changed my QBI deduction. Why? Income is above all the phase outs.